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MarketScreener Homepage  >  Equities  >  Australian Stock Exchange  >  Blue Energy Limited    BLU   AU0000044364

BLUE ENERGY LIMITED

(BLU)
  Report
End-of-day quote. End-of-day quote Australian Stock Exchange - 10/19
0.063 AUD   -4.55%
10/12BLUE ENERGY : Macquarie small midcap oil & gas forum
PU
09/16BLUE ENERGY : has assets in Bowen, Galilee and Beetaloo Basins
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09/15BLUE ENERGY : Appendix 4G and Corporate Governance Statement
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Blue Energy : Sep 2019 Quarterly Activities Report

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10/31/2019 | 11:52am EDT

31stOctober 2019

QUARTERLY ACTIVITIES REPORT

To 30thSeptember 2019

Blue Energy Limited (ASX: "BUL")is pleased to report on activities during the September 2019 quarter across its exploration acreage in Queensland and the Northern Territory in which the Company's key gas and oil projects are located.

Key points

  • Blue signs MOU with North Queensland Gas Pipelines Pty Ltd to bring more gas to industry in Townsville - giving Blue a northern gas market option
  • Gas Sale Agreement discussions expanded to Townsville opportunities
  • Southern Pipeline route to Wallumbilla continues under investigation
  • Hillalong Block power generation option progresses
  • Evaluation activity continues in adjacent acreage in Galilee Basin and Northern Territory
  • Total corporate gas resources position across all held acreage = 4,179 PJ+
  • Cash position - A$5.8 million as at 30 September 2019
  • The Company has zero debt

North Queensland Gas Pipeline MoU

As previously advised to the market (9thOctober 2019) Blue signed a non-binding MOU with North Queensland Gas Pipeline No.1 Pty Ltd and North Queensland Gas Pipeline No. 2 Pty Ltd (together referred to as NQGP) to facilitate bringing new domestic gas supplies into the strong Townsville market.

NQGP is North Queensland's only source of natural gas. The existing 391km onshore natural gas pipeline system transports gas from the producing Moranbah Gas Project in the Bowen Basin to power and industrial users in Townsville, Queensland. (see Figure 1).

As part of the MOU, NQGP will facilitate introductions to potential customers in Townsville for Blue Energy's Northern Bowen Basin gas reserves in the Sapphire Block of ATP814P, which is located in close proximity to the existing NQGP pipeline infrastructure. Blue will also seek to negotiate access to the existing Moranbah Gas Project (MGP) and gas processing facilities to minimise infrastructure duplication and hence cost for end users in the event Blue is successful in signing new gas buyers.

The MOU will assist the development of the supply and delivery of new affordable domestic gas to North Queensland gas users (and facilitate the development of the Sapphire reserves), who are seeking to secure long-term reliable and affordable domestic gas supply as a primary energy source or as feedstock for manufacturing.

1

Proven Basins

Bowen Basin, Queensland

ATP814P (Blue Energy 100% and Operator)

Administrative tenure matters are still pending on ATP814 and include the four Production Licence Applications (PLA) lodged by Blue Energy, which are with the Queensland Government and are progressing. Renewal of the underlying ATP is also on foot with the Government, as are the four Potential Commercial Areas applications to cover the remaining resource base in the permit. These tenure activities are being undertaken in parallel with the ongoing commercial negotiations. Investigations into power generation in the Hillalong Block are also ongoing.

ATP814 currently has 2P reserves of 71 PJ+and 3P reserves of 298 PJ+(as independently estimated by Netherland, Sewell and Associates (NSAI)). As mentioned above, there is also significant upside within the other constituent blocks comprising the Permit with a combined 3,248 PJ of Contingent Resources estimated by NSAI.

Figure 1:ATP814 Bowen Basin Queensland showing PL, PCA and PSL Applications and the NQGP gas pipeline to Townsville.

The broader Northern Bowen Basin Gas Province has a discovered resource of approximately 15,000 PJ of gas which is sufficient to underpin the east coast domestic gas market for the next 30 years, based on current market conditions. Blue's component of this estimate is currently 3,248 PJ+.

2

Surat Basin, Queensland

ATP854P (Blue Energy 100% and Operator)

This Permit contains 103 PJ of Contingent Resources, as reported to the market on 19/3/2013. Blue has Potential Commercial Area Applications (PCA's) over the permit with the Qld Government which will allow work to be undertaken to grow gas reserves and resources in parallel with the continued marketing of the gas resources to potential buyers.

As previously noted, PSL 2033 (the proposed Jemena pipeline from the Galilee Basin) is proposed to pass through ATP854 and connect to the Wallumbilla - Gladstone gas pipeline and is therefore conveniently located for Blue Energy to potentially utilize for gas export across the ATP in due course.

Figure 2: Pipeline routes impacting ATP854P, ATP813P and ATP814P

Emerging Basins

Greater McArthur Basin (Northern Territory)

(various permits and equities levels - Blue Energy Operator)

Following the a nearly three year hiatus resulting from the Pepper Inquiry and subsequent legislative change process (to incorporate just the exploration component of the Pepper recommendations), Blue has now commenced re-engagement with the Aboriginal Land Councils, Land owners, Government departments and other stakeholders to commence the process for lodgement of an Environmental Management Plan (EMP) and the new approval process regime ahead of the planned seismic activity in EP's 200, 205 and 207 contemplated under the previous approval system. Santos and Origin have tested the EMP lodgment and approval process for drilling and fracture stimulation, and there is now a fledgling template for EMP approvals of seismic acquisition activity.

3

A suspension of Work Program activity on Blue's three awarded tenures in the Northern Territory (EP 200, 205 & 207) is in force until February 2020.

Figure 2: Blue Energy's acreage portfolio highlighting the large McArthur Basin position in the NT

Galilee Basin (Queensland)

ATP813P (Blue Energy 100% and Operator)

Applications for PCA's were lodged with the Qld Government in 2017, together with an application to renew the ATP. These applications are on foot with the Qld Government. The on ground activity conducted by Blue Energy to date has resulted in the delineation of 838 PJ (net to Blue Energy) of Contingent gas Resources within the Betts Creek CSG play in ATP813P (as assessed by Netherland Sewell and Associates Inc).

In competitor activity adjacent to Blue's ATP813, the Glenaras Coal Seam Gas Pilot operated by Galilee Energy Ltd continues on production test (in ATP 2019). Galilee Energy is reporting minor gas flow from the test wells and expects rates to increase, thus providing proof of concept for the CSG play and de-risking the broader area to give confidence for Blue to conduct appraisal activities on its gas discoveries (838 PJ) already made in ATP813P.

In other activity, Comet Ridge and Vintage Energy have drilled conventional gas wells on the Albany structure, both of which have yielded gas shows in the older Devonian section. Establishment of commercial gas rates from these wells will open up a new play for the Basin to augment the existing CSG play. This play is recognised to exist in ATP813 and could be targeted by future seismic acquisition.

4

Corporate

Cash Position

Cash on hand at 30 September 2019 was $5.8 million.

The Company has zero debt.

Blue Energy Gas Reserves and Resources

P e rm it

B lo c k

A s s e s s m e

A nno unceme

M etho do lo

C ertifier

1P

1C

2P

2C

3P

3C

nt D ate

nt D ate

gy

(P J

(P J)

(P J

(P J)

(P J)

(P J)

)

)

A TP 854P

30/06/2012

19/03/2013

SP E/P RM S

NSA I

0

22

0

47

0

101

A TP 813P

29/10/2014

30/10/2014

SP E/P RM S

NSA I

0

0

0

61

0

830

A TP 814P

Sapphire

5/12/2015

8/12/2015

SP E/P RM S

NSA I

0

66

59

108

216

186

A TP 814P

Central

5/12/2015

8/12/2015

SP E/P RM S

NSA I

0

50

12

99

75

306

A TP 814P

M o nslatt

5/12/2015

8/12/2015

SP E/P RM S

NSA I

0

0

0

619

0

2,054

A TP 814P

Lancewo o d

5/12/2015

8/12/2015

SP E/P RM S

NSA I

0

5

0

23

1

435

A TP 814P

Hillalo ng

6/02/2019

7/02/2019

SP E/P RM S

NSA I

0

0

0

182

0

237

A TP 814P

So uth

30/06/2013

29/07/2013

SP E/P RM S

NSA I

0

15

0

27

6

30

T o tal (P J)

0

158

71

1,166

298

4,179

T o tal

0

27

12

199

51

714

Table 3: Blue Energy net Reserves and Resources

+Listing Rule 5.42 Disclosure

The estimates of reserves and contingent resources noted throughout this Quarterly Activities report have been provided by Mr John Hattner of Netherland, Sewell and Associates Inc (NSAI) and were originally reported in the Company's market announcements 25 January 2012, 26 February 2013, 19 March 2013, 8 December 2015 and 28 February 2019. NSAI independently regularly reviews the Company's Reserves and Contingent Resources. Mr Hattner is a full time employee of NSAI, has over 30 years' of industry experience and 20 years' of experience in reserve estimation, is a licensed geologist and a member of the Society of Petroleum Engineers (SPE), and has consented to the use of the information presented herein. The estimates in the reports by Mr Hattner have been prepared in accordance with the definitions and guidelines set forth in the 2007 Petroleum and Resource Management System (PRMS) approved by the SPE, utilizing a deterministic methodology. Blue Energy confirms that it is not aware of any new information or data that materially affects the information included in any of the announcements relating to ATP 813P, 814P or 854P referred to in this report and that all of the material assumptions and technical parameters underpinning the estimates in the announcements continue to apply and have not materially changed.

Petroleum Tenements Held

Table 4

Permit

Location

Interest Held

Interest Held

Previous Quarter

Current Quarter

ATP656P

Cooper Basin (Qld)

100%

100%

ATP657P

Cooper Basin (Qld)

100%

100%

ATP658P

Cooper Basin (Qld)

100%

100%

ATP660P

Cooper Basin (Qld)

100%

100%

ATP813P

Galilee Basin (Qld)

100%

100%

ATP814P

Bowen Basin (Qld)

100%

100%

ATP854P

Surat Basin (Qld)

100%

100%

ATP1112A

Carpentaria Basin (Qld)

100%

100%

ATP1114A

Georgina Basin (Qld)

100%

100%

ATP1117A

Georgina Basin (Qld)

100%

100%

ATP1123A

Georgina Basin (Qld)

100%

100%

5

Table 5

*Permit

Location

Interest Held

Interest

Comment

Previous Quarter

Held

Current

Quarter

EP199A*

Wiso Basin (NT)

10%

10%

See Note 1

EP200*

Wiso Basin (NT)

10%

10%

See Note 1

EP205*

Wiso Basin (NT)

10%

10%

See Note 1

EP206A*

Wiso Basin (NT)

10%

10%

See Note 1

EP207*

Wiso Basin (NT)

10%

10%

See Note 1

EP208A*

Wiso Basin (NT)

10%

10%

See Note 1

EP209A*

Wiso Basin (NT)

10%

10%

See Note 1

EP210A*

Wiso Basin (NT)

10%

10%

See Note 1

EP211A*

Wiso Basin (NT)

10%

10%

See Note 1

*Exploration blocks Blue is farming into

Note 1: Subject to Farm in Agreement which upon completion of the seismic work program will result in Blue Interest becoming a 50% equity participant

Contact: + 61 7 3270 8800

John Phillips

Managing Director

Blue Energy Limited

6

Disclaimer

Blue Energy Limited published this content on 31 October 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 October 2019 16:51:07 UTC


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Financials
Sales 2020 - - -
Net income 2020 -5,06 M -3,56 M -3,56 M
Net cash 2020 4,27 M 3,01 M 3,01 M
P/E ratio 2020 -9,96x
Yield 2020 -
Capitalization 81,1 M 57,4 M 57,1 M
EV / Sales 2019 -
EV / Sales 2020 -
Nbr of Employees -
Free-Float 63,3%
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Number of Analysts 1
Average target price 0,16 AUD
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Spread / Highest target 154%
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Managers
NameTitle
John M. Phillips Managing Director & Executive Director
John Charles Ellice-Flint Executive Chairman
Karen Johnson Non-Executive Director
Rodney Cameron Non-Executive Director
Stephen Rodgers Secretary & General Counsel
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